Japan's Export Surge

So the surge in activity in the US has sucked in a lot of imports, despit the rising yen. Let's see what happens next.

Japan's current account surplus unexpectedly widened in September as accelerating growth in the U.S. and Asia propelled exports, reinforcing expectations that a report later this week will show the economy grew for a seventh quarter. The surplus widened to 1.49 trillion yen ($13.7 billion) from 1.46 trillion yen in August, seasonally adjusted, the Ministry of Finance said in a report released in Tokyo. The surplus rose 20 percent to 8.35 trillion yen in the six months ended Sept. 30, a record amount for that period since at least 1985 when accounting methods changed, the report said.

Matsushita Electric Industrial Co. and Sharp Corp. are selling more goods abroad because of demand for flat-screen televisions and DVD players. Those gains are helping cushion a drop in consumer spending in Japan, allowing the economy to grow 0.3 percent in the third quarter from the previous three months, according to a separate Bloomberg News survey. "Manufacturers will continue to lead economic growth, as exports strengthen on the back of recovering overseas economies,'' said Masaki Kuwahara of Nomura Research Institute, whose forecast for a 1.41 trillion-yen surplus was the second-most accurate of 11 economists in the survey. He said net exports accounted for three- fourths of Japan's economic growth in the third quarter.

Canon Corp., Sony Corp. and other exporters are getting a spurt from rising growth in China and the U.S., the biggest markets for Japanese exports. The economy of the U.S., which buys 28 percent of Japanese exports, grew at an annual pace of 7.2 percent in the third quarter, the fastest pace since 1984. China's economy grew 9.1 percent in the third quarter from a year earlier. Exports rose 3.8 percent in September from August, seasonally adjusted, while imports rose for the first time in three months by 2 percent, today's report showed. The September trade surplus compares with a median forecast of 1.25 trillion yen in a Bloomberg survey.
Source: Bloomberg
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